Notification of increase in mortgage repayments

F

FiveFingers

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Hi,

We switched over our mortgage to NIB some months ago to a tracker mortgage. With the recent hikes in interest rates, I had expected to receive some sort of notification from NIB to tell me what the new rate is and what the increase in repayments is. I received nothing. I attempted to ring my branch, but was put through to a central customer service office. The lady I spoke to hadn't a clue what the procedure is or if any documentation is sent to the customers. She couldn't/wouldn't put me through to the person that I was dealing with in my local branch. Instead all she could do was send this person an email to ask them to contact me. (Are all their processes this convoluted???) I'm not holding out for that phone call.

Anyway, surely, there's an obligation on the bank to tell you that your repayments have increased?? How else would I know to increase the amount of money I put into the servicing account to meet these new higher repayments. What's going on?
 
We have a variable rate mortgage and don't receive any such communication from our bank - TBH I don't particularly want it either. The increases have all been nominal and so too is the increase in repayments. Surely you don't transfer the exact amount of your mortgage but allow for incidentals?
 
When I was with EBS they always wrote to us informing us of rate changes and the impact on monthly repayments. The annual statement also summarised these matters. Check the terms & conditions of your loan agreement to see what, if anything, it says about notification of changes in rate/repayments. Chances are that some lenders don't do this and simply say that rate changes will be published in the newspapers.
 
We have always received written notification from BOI when they changed their interest rate... the last one being this week!!
 
bacchus said:
We have always received written notification from BOI when they changed their interest rate... the last one being this week!!
Click to expand...

Same story with UB :(
 
Lorr: "Surely you don't transfer the exact amount of your mortgage but allow for incidentals?"

No, Lorr, we have a standing order going into our servicing account with an amount that's quite a bit higher than is needed for the monthly repayment. However, after all of the increases in rates, I still need to be sure that it's enough.

I finally got talking to the branch. With the changeover at Easter, they're all in a muddle. She admitted that they haven't a clue how to use the new system and that she will have to manually work out whether all of the increases in the ECB rate have actually been applied to our mortgage account and if the repayments being taken are actually enough!! How reassuring is that? She still doesn't know if the new procedure includes informing the customer of new rates. Before the changeover, I got statements of the servicing account every month.

Clubman, I'll have a look at the T&C of the mortgage loan and all the new bumpf they sent us after the changeover - there might be something in there.

I have to say, I'm less than impressed.
 
The time to read the T&Cs of any financial agreement is before signing but better late than never.
 
I'm still waiting for my notification aswell. and most recent bank statement which should have been out this week.
 
My mortgage is with AIB Finance and Leasing and they always notify me when they are putting up the repayments.

Maybe NIB haven't increased their rate yet.
 
I think it is a requirement of the Consumer Credit Act that the borrower is given notice of any increase in interest rates. However, I have looked at the Act and can't find the section.

It would certainly be a requirement of the Financial Regulator's Consumer Codes from November of this year.

One of the Irish Nationwide's objectionable practices was that the notification of interest rate change said that "Your rate has been reduced by .5% in line with changes in the Central BAnk rate". However, they did not notify the customer of what the new rate was, so customers were not aware of the fact that they were not getting the full interest rate cuts. I understand that the Financial Regulator instructed them to provide this information and they are now doing so.

Brendan
 
Surely the whole point of a tracker mortgage is that you know exactly how your mortgage rate is going to respond to changes in the ECB rate?

As soon as the ECB announces a rate rise (which is widely publicised in the newspapers and on TV), your mortgage rate is going to rise accordingly. Your tracker rate will be the ECB rate plus a set amount 1%, 1.25%, 1.5% etc, which you will know from the outset.

For non-tracker mortgages I would agree that the Banks should inform the customer of the precise changes in rate, because they may not increase/decrease the rate by the same amount as the ECB change - but the same is not true for trackers.
 
Disagree, bank has a legal obligation to notify you of the change. There must be some other explaination. How else do you know what your new repayment is going to be.
 
I think the point with the Tracker is made above as in its going to up and down with 'euribor' within a stated period of time such as 5 working days. Whether they are obliged to tell people individually is a moot point.

Usually if you are on direct debit, then the payment is automatically adjusted, whereas if you are on standing order, then you should arrange an increase.
 
Do people (other than those on fixed rates) actually pay mortgage repayments using SOs instead of DDs? Sounds like it would be hassle having to alter the amount each time the rate/repayment changed.
 
Im with PTSB and get a letter if there is any change in any payments/rates/etc. find them very efficient. happy that they always send out a letter informing the customer. its usually about 4 lines long also and isnt accompanied by a tonne of offers/deals like my boi account statements/credit card. to answer clubman i put in the same every month ( about 40/50 too much just to be on the safe side)
 
intermission said:
For non-tracker mortgages I would agree that the Banks should inform the customer of the precise changes in rate, because they may not increase/decrease the rate by the same amount as the ECB change - but the same is not true for trackers.
Click to expand...

While I imagine most people here would be aware of the ECB rate I believe the same is not true of the public at large. Many of these people may be on trackers and not be aware of every increase (of course one could make the arguement that they should be making themselves aware but in reality this is not going to happen with everyone).
 
Truth is, if you ask alot of people what interest rate they are on, or even if its tracker or variable they would'nt be able to tell you.
I have asked serveral people and find this to be the case.
 
These are probably the same people who don't know anything about their finances - incl. when their mortgage, car loan, SSIA is due!
 
I've had a mortgage with NIB for some time and, before we switched from their tracker to a three-year fixed rate last January, I always got notification of any changes in interest rates. In fact the wife and I would each receive a separate notification...
 
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